In this
interlocutory appeal, an economic development corporation
created by the City of Rosenberg contends that the trial
court erred in partially denying its plea to the
jurisdiction. Asserting entitlement to governmental immunity
from suit, the corporation, Rosenberg Development
Corporation, contends that the plaintiff, Imperial Performing
Arts, Inc., failed to establish a valid waiver of
governmental immunity and the trial court erred in denying
its plea. We conclude, however, that the corporation does not
enjoy governmental immunity from suit on these facts, and
thus the plaintiff was not required to establish a waiver of
immunity. Accordingly, we affirm the trial court's
partial denial of the corporation's plea to the
jurisdiction.

Background

The
Development Corporation Act of 1979 (the "Act")
authorizes certain municipalities to organize economic
development corporations for, inter alia, "the promotion
and development of new and expanded business enterprises to
provide and encourage employment and the public
welfare." Tex. Loc. Gov't Code § 501.004(a)(6).
Appellant, Rosenberg Development Corporation
("RDC"), is an economic development corporation
organized under the Act by the City of Rosenberg. According
to RDC's articles of incorporation, it exists
"exclusively for the purposes of. . . promoting,
assisting[, ] and enhancing economic and industrial
development activities . . . and . . . promot[ing] or
develop[ing] new or expanded business enterprises, including
public facilities."

In
March 2012, RDC entered into a Performance Agreement with
Imperial Performing Arts, Inc. ("IPA"), a nonprofit
organization that promotes and produces performance and
visual arts. Under the Performance Agreement, RDC agreed to
pay IPA $500, 000 in two installments. In exchange, IPA
purportedly would lease, renovate, and operate both an
"Arts Center" and the historic Cole Theater in
downtown Rosenberg (though IPA contends that the contract
obligated IPA only to arrange to renovate and open the Cole
Theater).

After
IPA began renovating the building that would house the Arts
Center, IPA realized the conversion would be more
time-consuming and expensive than IPA allegedly had been led
to believe. In September 2012, IPA requested a forty-five day
extension from RDC; RDC's board of directors voted to
give IPA a sixty day extension. IPA eventually finished the
conversion and opened the Arts Center in November 2012. Since
then, IPA has continuously occupied the Arts Center.

Meanwhile,
IPA also began prep work on the planned renovation of the
Cole Theater, but realized that the theater project, like the
Arts Center, would be more extensive and costly than
initially envisioned. IPA alleges that an engineering and
construction company declined to serve as the project's
general contractor, telling IPA that the theater was so
deteriorated that any "renovation" would
effectively require complete rebuilding.

According
to IPA, by November 2013 it became obvious that the original
plan to renovate and reopen the Cole Theater was not
feasible. At a meeting between IPA's and RDC's
respective boards of directors, one of RDC's directors
allegedly projected that renovating the Cole Theater would
cost between three and five million dollars and would take up
to five years. This estimate was greater, as to both timing
and cost, than any information previously available to IPA
and, if accurate, IPA contends, impaired or prevented
IPA's ability to accomplish the Performance
Agreement's objectives.

In
February 2014, IPA told RDC's board of directors that IPA
could not renovate and open the Cole Theater by December 2014
as planned. IPA asked for an extension and also asked to
discuss amending the Performance Agreement to allow IPA to
move to an alternate venue or build its own facility. In
April 2014, IPA again asked for an extension and to amend the
Performance Agreement.

RDC
allegedly refused to amend the Performance Agreement or to
grant IPA an extension for the Cole Theater project. IPA
stopped progress on the Cole Theater project in June 2014.

IPA
then sued RDC for, as relevant here, breach of contract by
unreasonably failing to grant an extension of the Performance
Agreement. IPA also sought a judgment declaring that the
Performance Agreement constitutes an absolute grant to IPA of
the funds provided by RDC.[1]

RDC
filed a counterclaim for breach of contract and declaratory
judgment that IPA breached the Performance Agreement. RDC
also filed a plea to the jurisdiction regarding IPA's
claims for damages. In its plea, RDC argued that: (1)
IPA's alleged damages are consequential damages, which
IPA cannot recover in a suit against a local governmental
entity under Local Government Code section 271.153; (2) RDC
is immune from liability for IPA's damages claims under
Local Government Code section 505.106 as to its performance
of governmental functions; (3) RDC did not waive its immunity
from suit by asserting claims against IPA because RDC's
claims were more akin to recovering a civil penalty and were
not in the nature of a damages claim; and (4) IPA failed to
plead a valid legislative waiver of governmental immunity for
its breach of contract claim.

The
trial court granted RDC's plea as to IPA's claim that
RDC breached the Performance Agreement by refusing to discuss
an extension under the contract and by refusing to give IPA a
reason for the refusal to grant an extension. The trial court
denied the plea as to IPA's claim that RDC breached the
Performance Agreement by unreasonably refusing to grant an
extension; denied the plea as to IPA's claim for
declaratory judgment; and denied the plea by rejecting
RDC's arguments that IPA's damages claims for breach
of contract are barred by Local Government Code sections
271.153 and 505.106.

RDC
filed a notice of interlocutory appeal. On appeal, RDC
challenges the portions of the trial court's order
denying its plea to the jurisdiction.

Analysis

A.
Appellate Jurisdiction

We
first address our jurisdiction over this interlocutory
appeal. Though IPA has not challenged RDC's right to
appeal the challenged order interlocutorily, we examine our
appellate jurisdiction independently and sua sponte. See
SJMed. Or., L.L.C. v. Estahbanati,418 S.W.3d 867, 870
(Tex. App.-Houston [14th Dist] 2013, no pet.). Generally, our
appellate jurisdiction is confined to appeals of final
judgments. See Royal Indep. Sch. Dist. v. Ragsdale,273 S.W.3d 759, 763 (Tex. App.-Houston [14th Dist.] 2008, no
pet.). The legislature, however, has specified circumstances
in which a litigant may appeal immediately from an otherwise
unappealable order because a final judgment has not been
rendered. See Tex. Civ. Prac. & Rem. Code §
51.014(a). RDC relies on one of these provisions, which
allows a litigant to appeal from a trial court's
interlocutory order that grants or denies a plea to the
jurisdiction by a governmental unit as that term is defined
in Texas Civil Practice and Remedies Code section 101.001.
See id. § 51.014(a)(8).

RDC
filed a plea to the jurisdiction, which the trial court
partially denied. A threshold issue for this court to resolve
is whether RDC is a "governmental unit, " as that
term is defined in the Texas Civil Practice and Remedies
Code. If RDC is a "governmental unit, " we have
jurisdiction over its interlocutory appeal. See id.

Under
the relevant portion of the Texas Civil Practice and Remedies
Code, a "governmental unit" is:

(A) this state and all the several agencies of government
that collectively constitute the government of this state,
including other agencies bearing different designations, and
all departments, bureaus, boards, commissions, offices,
agencies, councils, and courts;

(B) a political subdivision of this state, including any
city, county, school district, junior college district, levee
improvement district, drainage district, irrigation district,
water improvement district, water control and improvement
district, water control and preservation district, freshwater
supply district, navigation district, conservation and
reclamation district, soil conservation district,
communication district, public health district, and river
authority;

(C) an emergency service organization; and

(D) any other institution, agency, or organ of government the
status and authority of which are derived from the
Constitution of Texas or from laws passed by the legislature
under the constitution.

Id. § 101.001(3).

The
first three subsections are inapplicable. RDC is neither an
agency nor a political subdivision of the state, and RDC is
not an emergency service organization. Thus, the issue is
whether RDC qualifies as a "governmental unit"
under subsection (D). To meet subsection (D)'s
requirements, the entity claiming governmental unit status
must (1) be an "institution, agency, or organ of
government" and (2) derive its "status and
authority" as such from "laws passed by the
Legislature." Id.; see Univ. of the Incarnate Word
v. Redus, No. 15-0732, 2017 WL 1968030, at *4 (Tex. May
12, 2017); see also LTTS Charter Sch., Inc. v. C2
Constr., Inc.,342 S.W.3d 73, 75-78 (Tex. 2011).

In
determining the status and authority of RDC, an economic
development corporation, we first note that such entities
would not exist but for legislative enactment. Tex. Loc.
Gov't Code §§ 501.011, 501.051. As a creature
of statute, the legislature has defined RDC's status and
authority. For example, RDC has all powers incidental to or
necessary for the performance of its statutory authority to
sue and be sued with respect to a project; to adopt and amend
bylaws for the corporation's affairs; to lease or sell
all or any part of a project; to donate or convey property to
an institute of higher education; to make a secured or
unsecured loan to finance all or part of the cost of a
project; and to issue, sell, or ...

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